December 8, 2025
Car Insurance Coverage
What Is Rideshare Insurance Coverage?
Ever thought about what would happen if your personal auto insurance didn’t cover you while driving for Uber, Lyft, or other transportation network services (TNCs)? Many drivers don’t realize there’s a gray zone called “coverage gaps,” a situation when your personal car insurance and the ridesharing company’s policy don’t fully protect you.
The National Association of Insurance Commissioners (NAIC) also emphasizes getting a rideshare endorsement by saying, “while every personal auto insurance policy differs, most contain exclusions when a person uses their vehicle for livery services.” This means you need real coverage if you use your vehicle for ridesharing or delivery services, even if you have standard personal auto insurance. Besides, you deserve peace of mind too when you're delivering food, picking up passengers, or just waiting for a ride request. So, in this guide, the USA Auto editorial team breaks down what rideshare coverage is, how it works, and what it covers for you.
What Is Rideshare Coverage?
In simple words, rideshare is a type of auto insurance designed for people who use their personal cars to drive for ridesharing companies like Uber or Lyft. It fills the coverage gaps between your personal auto insurance policy and the insurance provided by the ridesharing company.
For example, if you’re waiting for a ride request and get into an accident, your regular insurance may not cover it, but rideshare insurance will. In essence, it’s protection that keeps you, your vehicle, and your passengers safe while you’re on the road earning.
How Does Rideshare Insurance Coverage Work?
Ridesharing insurance coverage works by providing you with financial protection when you drive your personal vehicle for business, like driving for Uber, Lyft, or DoorDash. It’s crucial since your personal auto insurance usually becomes ineffective the moment you open a ridesharing app. Because that’s considered “business use.” Here's how rideshare insurance works for you (if you have one):
- Period 1: You’re online and waiting for a ride request. Your rideshare coverage helps protect you if an accident happens before a passenger is assigned.
- Period 2: You’ve accepted a request and are on your way to pick up your passenger. Here. The ridesharing company provides limited liability coverage, while your rideshare insurance add-on can fill the remaining gaps.
- Period 3: You’re driving with the passenger in your car. The ridesharing company’s insurance offers higher liability and property damage protection, but having rideshare car insurance ensures extra security.
So, rideshare insurance basically bridges what your personal auto insurance won’t cover and what the ridesharing company may limit.
Who Needs Rideshare Insurance Coverage and Why?
If you have read this far, you probably understand how vulnerable you are as a rideshare driver if you only have TNC's insurance and personal auto insurance. Because if something happens on the road, neither of these coverages will fully protect you.
That’s why anyone who drives for rideshare companies like Uber, Lyft, or delivers for Uber Eats or DoorDash needs rideshare insurance coverage. Why? Again, personal auto insurance won’t fully cover you once you start driving for business. In this moment, coverage gaps appear, and those gaps can cost you thousands of dollars in the event of a severe accident.
Here's who truly benefits from rideshare car insurance:
- Part-time rideshare drivers who use their personal car for both work and personal errands.
- Full-time drivers who rely on ridesharing income and can’t afford downtime after an accident.
- Delivery drivers for Uber Eats, DoorDash, or similar ridesharing services.
- Anyone who wants peace of mind knowing their vehicle, passengers, and income are all protected.
What Does Rideshare Insurance Cover?
If you’ve a rideshare endorsement on your auto policy, it will make sure you don’t pay out of pocket in emergencies. Here’s what rideshare insurance usually covers:
- Bodily injury and property damage liability, if you cause an accident while driving for a ridesharing company.
- Collision and comprehensive coverage for your vehicle, even when it’s being used for business.
- Medical payments or personal injury protection (PIP) for you and your passengers.
- Uninsured or underinsured motorist coverage, in case the other driver doesn’t have enough insurance.
- Rideshare gap coverage, which helps with the deductible or fills in missing protection between your policies.
When Does Rideshare Insurance Not Cover?
Rideshare insurance surely provides essential financial safety while you’re using your personal car for ridesharing. However, it doesn’t cover a few things in certain situations that you should remember as well.
- Driving for a transportation company without notifying your auto insurer.
- Using your vehicle for commercial activities outside approved ridesharing services.
- Mechanical breakdowns or regular wear and tear.
- Driving outside the coverage area or in states where rideshare endorsements aren’t available.
Benefits of Having Rideshare Car Insurance
No one buys a thing if they don’t find value in it. That said, when the benefits are truly compelling, you’ll quickly recognize the necessity of carrying rideshare auto insurance. Here are the top benefits of having this coverage:
- Closes the Coverage Gap: You get full protection from the moment you log on until you drop off your passenger.
- Lowers Deductibles: Helps cover the deductible gap when the ridesharing company's policy applies.
- Protects Your Personal Policy: Prevents your personal auto insurer from canceling your policy due to commercial driving.
- Expands Coverage: Covers property damage and injuries that might fall outside the ridesharing company’s limits.
Are you a ridesharing driver in Michigan? Reap all the benefits of rideshare endorsements on your personal auto policy by insuring your vehicle with USA Auto. We offer reliable coverage at affordable rates, especially in Michigan, as well as other states. Give us a call (866) 855-1872 or get your car insurance quote online right away!
How Much Does Rideshare Insurance Cost?
Insurers cannot provide an exact rate for rideshare coverage until you share your insurance history, driving record, and vehicle information to receive a final quote. However, according to industry sources like LendingTree, rideshare drivers typically pay an average of $31 per month for the coverage add-on.
For example, if your personal auto policy costs $120 per month, adding the rideshare endorsement would bring your total monthly premium to approximately $151 per month.
What Happens If I Don't Disclose Rideshare Driving to My Insurer?
Failing to inform your auto insurer about rideshare driving is a serious risk. Most personal policies explicitly exclude coverage for business use (known as the "livery exclusion").
The Consequences of Nondisclosure:
- Claim Denial: Your insurer can deny any claim related to the ridesharing activity, even when waiting for a request, leaving you financially exposed.
- Policy Cancellation: The insurer can cancel your policy entirely, refuse to renew it, or void the policy for material misrepresentation.
- Out-of-Pocket Expenses: You would be personally liable for all repair, replacement, and medical expenses, as you would be driving uninsured during that period.
You can avoid all these consequences by simply contacting your insurer and letting them know about the business use of your vehicle, like ridesharing.
What If My Insurer Doesn't Offer Rideshare Coverage?
Some insurers do not offer rideshare endorsements. If this is the case, you should consider one of the following options:
- Switch to an insurance company that offers a rideshare add-on.
- Purchase a standalone rideshare policy from a different carrier.
- Purchase a full commercial auto insurance policy. In fact, some states require a commercial car insurance policy for ridesharing instead of a simple "rideshare endorsement."
What Happens If I’m At-fault in an Accident and My Customer Is Injured?
Now, if you’re at fault in an accident and your customer or passenger is injured, the situation can get complicated quickly. Your ridesharing company’s insurance will usually provide liability coverage for the passenger’s injuries. Unfortunately, it might not cover all expenses. If the costs exceed their limits, your rideshare car insurance can step in to cover the rest.
Now, let’s explain different situations and how they work:
- If you’re waiting for a ride request, your rideshare coverage helps with damage to your personal policy won’t.
- If an uninsured driver hits you, rideshare gap coverage or uninsured motorists protection can cover your losses.
- If you’re driving a passenger when the accident happens, the ridesharing company’s policy offers primary coverage, but your rideshare endorsement ensures you’re covered for the remaining expenses.
Where to Get Rideshare Insurance?
It’s super easy to get rideshare insurance if you’re a rideshare driver. You can simply start by talking to your current auto insurer and asking if they offer a rideshare endorsement or a special rideshare car insurance plan. Not all insurance providers offer it, but if you’re a USA Auto Policyholder, we can help you find the right coverage that aligns with your driving habits and budget.
To buy it, simply:
- Ask about rideshare coverage options for Uber, Lyft, or delivery driving.
- Complete deductibles, liability limits, and additional coverages.
- Choose a policy that protects you during all driving periods.
Whether you need rideshare coverage or full protection as a rideshare driver, contact one of our auto insurance agents today and ensure the most reliable safety net.
Is Rideshare Coverage Worth It?
Yes, rideshare coverage is worth it if you regularly use your vehicle for ridesharing services. If you drive for a TNC without this coverage, your personal insurer will consider you uninsured during that time. This means you won’t be covered for any losses, including injuries or property damage. While your TNC company's provided coverage may offer some benefits, your regular personal car insurance will not apply.
Since rideshare insurance is typically affordable and widely available, you should carry it as a rideshare or delivery service driver. You will realize its worth if something goes wrong on the road.
Rideshare Insurance Coverage FAQs
Do I need insurance as a delivery driver?
Yes, you do. Your personal auto insurance doesn’t cover deliveries. You’ll need rideshare or delivery insurance or DoorDash.
What types of insurance do I need if I am an Uber Eats, DoorDash, or similar delivery service driver?
You’ll need rideshare coverage or a rideshare endorsement on your policy. It covers your duty during active deliveries, fills coverage gaps, and protects your vehicle and income.
Does my personal auto insurance cover ride sharing or car sharing?
No, it does’. Once you use your car for business, your personal policy steps in. Then, you’ll need rideshare insurance coverage to stay protected.
How does rideshare insurance work when I’m working for multiple TNCs?
Rideshare insurance coverage doesn’t just follow you or your vehicle. It does protect you across all ridesharing companies, including Uber, Lyft, and delivery apps.
What if rideshare insurance or endorsement isn’t available in my state?
If it’s not available, look for commercial auto insurance or a special rideshare policy from a provider like USA Auto Insurance. They can help you find an alternative that still protects your vehicle and income.
How much coverage will my rideshare company provide?
Most rideshare companies like Uber or Lyft offer liability coverage up to $1 million while you’re carrying passengers. During wait times, coverage is much lower. That’s why you'd better add rideshare insurance coverage.
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